Freedom Broker Upgrades Lifeway Foods (LWAY) to Buy

Freedom Broker analyst Georgy Vashchenko upgraded Lifeway Foods (NASDAQ: LWAY) from Hold to Buy with a price target of $32.00 (from $34.00).

The analyst comments "Record sales underscore robust underlying demand. Lifeway reported its highest quarterly net sales of $66.9M, up 24.1% YoY and above our $61.8M estimate. Growth remained primarily volume-led and was driven by continued demand for branded drinkable kefir, marking the company’s 27th consecutive quarter of YoY sales growth. ● Elevated input costs significantly compressed profitability. Gross margin declined to 19.5% from 28.6% last year, primarily reflecting higher conventional milk prices and, to a lesser extent, resinbased packaging and transportation costs. Conventional milk prices are expected to remain elevated in Q3 before beginning to ease in Q4. ● We lower our price target to $32 from $34 and upgrade LWAY to Buy from Hold. Our revised forecasts incorporate materially lower near-term profitability, partially offset by stronger revenue expectations and gradual margin recovery."

For an analyst ratings summary and ratings history on Lifeway Foods click here. For more ratings news on Lifeway Foods click here.

Shares of Lifeway Foods closed at $24.70 yesterday.

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